SF 2628

as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to taxes; making technical adjustments to the 
  1.3             one percent premium tax; amending Minnesota Statutes 
  1.4             1997 Supplement, section 60A.15, subdivision 1. 
  1.5   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.6      Section 1.  Minnesota Statutes 1997 Supplement, section 
  1.7   60A.15, subdivision 1, is amended to read: 
  1.8      Subdivision 1.  [DOMESTIC AND FOREIGN COMPANIES.] (a) On or 
  1.9   before April 1, June 1, and December 1 of each year, every 
  1.10  domestic and foreign company, including town and farmers' mutual 
  1.11  insurance companies, domestic mutual insurance companies, marine 
  1.12  insurance companies, health maintenance organizations, community 
  1.13  integrated service networks, and nonprofit health service plan 
  1.14  corporations, shall pay to the commissioner of revenue 
  1.15  installments equal to one-third of the insurer's total estimated 
  1.16  tax for the current year.  Except as provided in paragraphs (d), 
  1.17  (e), (h), and (i), installments must be based on a sum equal to 
  1.18  two percent of the premiums described in paragraph (b). 
  1.19     (b) Installments under paragraph (a), (d), or (e) are 
  1.20  percentages of gross premiums less return premiums on all direct 
  1.21  business received by the insurer in this state, or by its agents 
  1.22  for it, in cash or otherwise, during such year. 
  1.23     (c) Failure of a company to make payments of at least 
  1.24  one-third of either (1) the total tax paid during the previous 
  1.25  calendar year or (2) 80 percent of the actual tax for the 
  2.1   current calendar year shall subject the company to the penalty 
  2.2   and interest provided in this section, unless the total tax for 
  2.3   the current tax year is $500 or less. 
  2.4      (d) For health maintenance organizations, nonprofit health 
  2.5   service plan corporations, and community integrated service 
  2.6   networks, the installments must be based on an amount determined 
  2.7   under paragraph (h) or (i). 
  2.8      (e) For purposes of computing installments for town and 
  2.9   farmers' mutual insurance companies and for mutual property 
  2.10  casualty companies with total assets on December 31, 1989, of 
  2.11  $1,600,000,000 or less, the following rates apply: 
  2.12     (1) for all life insurance, two percent; 
  2.13     (2) for town and farmers' mutual insurance companies and 
  2.14  for mutual property and casualty companies with total assets of 
  2.15  $5,000,000 or less, on all other coverages, one percent; and 
  2.16     (3) for mutual property and casualty companies with total 
  2.17  assets on December 31, 1989, of $1,600,000,000 or less, on all 
  2.18  other coverages, 1.26 percent. 
  2.19     (f) If the aggregate amount of premium tax payments under 
  2.20  this section and the fire marshal tax payments under section 
  2.21  299F.21 made during a calendar year is equal to or exceeds 
  2.22  $120,000, all tax payments in the subsequent calendar year must 
  2.23  be paid by means of a funds transfer as defined in section 
  2.24  336.4A-104, paragraph (a).  The funds transfer payment date, as 
  2.25  defined in section 336.4A-401, must be on or before the date the 
  2.26  payment is due.  If the date the payment is due is not a funds 
  2.27  transfer business day, as defined in section 336.4A-105, 
  2.28  paragraph (a), clause (4), the payment date must be on or before 
  2.29  the funds transfer business day next following the date the 
  2.30  payment is due.  
  2.31     (g) Premiums under medical assistance, general assistance 
  2.32  medical care, the MinnesotaCare program, and the Minnesota 
  2.33  comprehensive health insurance plan and all payments, revenues, 
  2.34  and reimbursements received from the federal government for 
  2.35  Medicare-related coverage as defined in section 62A.31, 
  2.36  subdivision 3, paragraph (e), are not subject to tax under this 
  3.1   section. 
  3.2      (h) For calendar years 1997, 1998, and 1999, the 
  3.3   installments for health maintenance organizations, community 
  3.4   integrated service networks, and nonprofit health service plan 
  3.5   corporations must be based on an amount equal to one percent of 
  3.6   premiums described under paragraph (b).  Health maintenance 
  3.7   organizations, community integrated service networks, and 
  3.8   nonprofit health service plan corporations that have met the 
  3.9   cost containment goals established under section 62J.04 in the 
  3.10  individual and small employer market for calendar year 1996 are 
  3.11  exempt from payment of the tax imposed under this section for 
  3.12  premiums paid after March 30, 1997, and before April 1, 1998.  
  3.13  Health maintenance organizations, community integrated service 
  3.14  networks, and nonprofit health service plan corporations that 
  3.15  have met the cost containment goals established under section 
  3.16  62J.04 in the individual and small employer market for calendar 
  3.17  year 1997 are exempt from payment of the tax imposed under this 
  3.18  section for premiums paid after March 30, 1998, and before April 
  3.19  1, 1999.  Health maintenance organizations, community integrated 
  3.20  service networks, and nonprofit health service plan corporations 
  3.21  that have met the cost containment goals established under 
  3.22  section 62J.04 in the individual and small employer market for 
  3.23  calendar year 1998 are exempt from payment of the tax imposed 
  3.24  under this section for premiums paid after March 30, 1999, and 
  3.25  before January 1, 2000.  
  3.26     (i) For calendar years after 1999, the commissioner of 
  3.27  finance shall determine the balance of the health care access 
  3.28  fund on September 1 of each year beginning September 1, 1999.  
  3.29  If the commissioner determines that there is no structural 
  3.30  deficit for the next fiscal year, no tax shall be imposed under 
  3.31  paragraph (d) for the following calendar year.  If the 
  3.32  commissioner determines that there will be a structural deficit 
  3.33  in the fund for the following fiscal year, then the 
  3.34  commissioner, in consultation with the commissioner of revenue, 
  3.35  shall determine the amount needed to eliminate the structural 
  3.36  deficit and a tax shall be imposed under paragraph (d) for the 
  4.1   following calendar year.  The commissioner shall determine the 
  4.2   rate of the tax as either one-quarter of one percent, one-half 
  4.3   of one percent, three-quarters of one percent, or one percent of 
  4.4   premiums described in paragraph (b), whichever is the lowest of 
  4.5   those rates that the commissioner determines will produce 
  4.6   sufficient revenue to eliminate the projected structural 
  4.7   deficit.  The commissioner of finance shall publish in the State 
  4.8   Register by October 1 of each year the amount of tax to be 
  4.9   imposed for the following calendar year. 
  4.10     (j) In approving the premium rates as required in sections 
  4.11  62L.08, subdivision 8, and 62A.65, subdivision 3, the 
  4.12  commissioners of health and commerce shall ensure that any 
  4.13  exemption from the tax as described in paragraphs (h) and (i) is 
  4.14  reflected in the premium rate. 
  4.15     Sec. 2.  [SPECIAL PREMIUM TAX PAYMENT.] 
  4.16     Health maintenance organizations, community integrated 
  4.17  service networks, and nonprofit health service plan corporations 
  4.18  that have met the cost containment goals established in 
  4.19  Minnesota Statutes, section 62J.04, in the individual and small 
  4.20  employer market for calendar year 1996 shall pay a special, 
  4.21  one-time 1999 premium tax payment.  The tax payment must be 
  4.22  based on an amount equal to one percent of gross premiums less 
  4.23  return premiums on all direct business received by the insurer 
  4.24  in this state, or by its agents for it, in cash or otherwise 
  4.25  after March 30, 1997, and before January 1, 1998.  Payment of 
  4.26  the tax under this section is due January 2, 1999.  Provisions 
  4.27  relating to the payment, assessment, and collection of the tax 
  4.28  assessed under Minnesota Statutes, section 60A.15, shall apply 
  4.29  to the special tax payment assessed under this section.